The Myth:
If the business performed well historically, its value is guaranteed.

The Reality:
Valuation focuses on expected performance — not just historical results. Past success doesn’t guarantee future results, especially if market conditions, customer bases, or management teams are changing.

Why It Matters:
Relying on history can create blind spots for buyers, lenders, and owners planning their exits if market conditions, customer bases, etc. are different from those in the past.

Practical Tip:
Develop normalized cash flow based on today’s facts and risks — not just yesterday’s wins.